New hydrogen hype in 2025? Nel ASA, thyssenkrupp nucera, Plug Power, and First Hydrogen

First Hydrogen: 17% price increase just the beginning?

Nuclear energy has been experiencing a revival this year. To meet the energy needs of artificial intelligence and as a base-load alternative to coal and gas, countries and corporations such as Microsoft, Google, Amazon & Co. are relying on nuclear reactors as an important part of the energy mix of the future. The trend here is towards small modular nuclear reactors that can be built decentrally to relieve the burden on power grids. This is also what First Hydrogen wants to focus on in the future for the production of hydrogen. Last week's announcement of the plans was the starting signal for a 17% rally. If the hype surrounding nuclear energy continues in the coming year – and the chances are good that the triggers will remain in place – First Hydrogen's share price should continue to rise.

The Company has announced that it is currently reviewing various projects to expand its Hydrogen-as-a-Service offering. This is because the power grids would reach their capacity limits, and hydrogen using electricity generated by small modular nuclear reactors (SMRs) would have great potential in this environment. SMRs are compact, efficient nuclear energy systems that provide a scalable, decentralized and globally recognized green alternative to fossil energy sources. First Hydrogen could build SMRs in areas where grid power is limited or non-existent to produce hydrogen for fueling stations. Therefore, the cost of generating electricity in SMRs could be as low as 3.6 cents per kWh, making it competitive.

In addition, First Hydrogen is working on a breakthrough in 2025 for its hydrogen-powered fuel cell electric vehicle (FCEV). Test vehicles have been successfully deployed in the UK by online giant Amazon, among others. The first major orders should cause a reassessment at the Company, which is currently valued at less than CAD 20 million. The past few days have shown how quickly the share price can rise.

Nel: Order from Samsung

The topic of hydrogen from nuclear energy could indeed receive more attention in the coming year and thus electrify the share price of First Hydrogen. Nel also recently reported a first step in this direction.

The industrial group Samsung C&T Corporation Engineering & Construction Group has commissioned the Norwegians to supply a 10 MW plant for alkaline electrolysis to produce hydrogen from surplus nuclear power. The order for the pilot plant has a volume of EUR 5 million. This is not enough to sustainably improve the prospects for the Company, which is still valued at NOK 5.3 billion. This illustrates the valuation problem of Nel and Plug Power in comparison to newcomers such as First Hydrogen.

Plug Power and thyssenkrupp Nucera: Bankruptcy or a Buy opportunity?

Speaking of Plug Power, the coming weeks could prove turbulent for shareholders. The US company is considered one of the major losers of Donald Trump's election as the next US president. Particularly critical is that Plug Power is still waiting for important – if not vital – subsidies. In the best case, these should flow before the change of government in January. This uncertainty was used by a short seller last week to put pressure on the price with rumours. Allegedly, the US Department of Energy (DOE) could refuse to pay out the much-needed loan. Plug Power was forced to refute the short seller's report. The Company expects the payment to be made before Donald Trump takes office.

And what is thyssenkrupp nucera doing? The German hydrogen hope has not provided any operational news in the past few weeks. The stock has lost around 50% in the current year and is hovering between EUR 8 and EUR 9.

Most recently, the analysts at mwb research had expressed a positive view. During a roundtable, the Company confirmed the preliminary figures for the 2023/2024 financial year and the long-term outlook. According to mwb's estimate, incoming orders for the 2023/2024 financial year will be slightly higher than in the previous year, at around EUR 630 million. Despite the challenges, nucera's management is optimistic about the recovery of the hydrogen market and believes it is strongly positioned for future growth. The analysts, therefore, recommend buying nucera shares with a price target of EUR 13.50.

Will hydrogen stocks make a comeback next year? Investors will likely need to continue paying close attention. While hydrogen is set to become an important component in the future energy mix, the market has yet to gain real momentum. The high losses and continued high valuations of the former darlings Nel and Plug Power remain a burden. Newcomer First Hydrogen appears much more attractive in terms of opportunities and valuation. thyssenkrupp nucera has already demonstrated that a profitable business model can be built.